Tuesday, December 31, 2013

Smashwords Year in Review 2013 - Indie Authors the Stewards of Publishing's Future

Welcome to my annual Smashwords year in review.

It was another amazing year.

On behalf of all employees at Smashwords, I want to start by thanking every Smashwords author, publisher and agent that publishes and distributes with Smashwords. We serve at your pleasure and we appreciate your trust, partnership and support.

I also want to thank the retailers and library aggregators that comprise the Smashwords distribution network. Every day, you work tirelessly and often without adequate recognition for the amazing service you provide our authors and publishers. You receive, ingest and merchandise our books to your customers. You introduce our authors' books to tens of millions of readers each year. We work for our authors by working for you. Your success is our authors' success, and we will reciprocate your support by working for your continued success.

The Smashwords Backstory

If you're one of the 25,000 new authors who joined the Smashwords family this year, welcome. A brief introduction is in order.

Back in 2008, I created Smashwords to give indie authors a seat at the publishing table. Back then, a time I refer to as the Dark Ages, traditional publishers held oligopolistic control over the
printing, publishing and distribution of books.

The control was oppressive. Writers were forced to bow subservient to the whims of big publishers. Publishers decided which writers became published authors. Although they published many great books, over the course of decades they crushed the dreams of thousands great writers whose talent is now lost to humanity.

Publishers decided what readers could read. Their decisions were guided by the publisher's perception of a book's anticipated commercial merit. Their decisions were guesses. When a book hit the bestseller lists, publishers patted themselves on the back for discovering and supporting the author. When a book failed, the author's future publishing opportunities often failed with it.

The dirty little secret of publishing is that in the end, publishers were simply throwing what they thought was their best spaghetti against the wall. Readers were the deciders of commercial success, not publishers.

It's not that publishers are bad. Inside the hallowed halls of their Manhattan and London skyscrapers, publishers are made up of thousands of passionate, intelligent and ethical people who love books and have dedicated their lives to discovering, developing and publishing great books by great authors. The problem with publishing was not a problem with the people of publishing, it was a problem with the business of publishing.

Back before the time of books as digital bits, most legacy publishing practices made sense. They were unable to take a risk on every author.

With the advent of ebooks, self publishing platforms such as Smashwords, and democratized distribution to major retailers, a new world order is emerging. It's a new world order where the power of publishing is shifting from the halls of publishers to the hands of writers. It's a world where the suffocating gatekeeping mentality - which once measured a book's worth through the myopic lens of perceived commercial merit - can now be cast away.

Books are worth more than dollars, pounds, euros and yen. Publishers don't know what readers want to read, and they have no right to control what writers want to imagine, write or publish. Writers deserve the freedom to publish what they want, and readers deserve the freedom to read what they want. The new world order is beautifully democratic and fair.

This is an exciting time to be a writer, author, publisher and ebook distributor. All of us are smack dab in the middle of turbulent cross-currents of change, innovation and opportunity.

Indie Authors are the Stewards of Publishing's Future

If this new world ever feels scary or uncertain, that's because it is. But despite the uncertainty, one fact will remain true forever: Books are magical, writers are the magicians, and as long as great writers continue to write and publish, books have a permanent place in our lives.

You - the indie author - are the future of publishing. Your publishing, distribution and marketing decisions will determine the course of the publishing industry. You're in charge now. Lead us well.

Now on with the Smashwords year in review.

Notable Smashwords Business Milestones for 2013

It was another great year at Smashwords, and a great year for Smashwords authors. Here are some notable business milestones for the year.

Title growth - Smashwords now publishes over 275,000 titles, up 45% from one year ago.

Authors - We now support the publishing strategies of over 83,000 authors from every corner of the globe, up 42% year over year.

Record revenue - Our authors' sales grew to $20 million, up 33% from $15 million the year before. We're proud that 100% of our revenue in 2013 came from the sale of books to readers. We don't sell publishing packages and we don't employ sales people. Our income is entirely based on our commission on book sales to readers which for most sales is 10% of the retail price.

Employee count - The Smashwords team grew to 23 people, up from 19 in 2012, 13 in 2011 and 3 in 2010. This year we made significant investments in technology, distribution systems and author and customer service.

Profitability - Smashwords has been profitable now for three years. Profitability is important because it means we're here for the long haul and can reinvest in you. We're self-funded, sustainable and will continue to grow the business on your behalf. We've grown the business without the assistance or interference of outside venture capital.

Bowker named Smashwords #1 ebook producer of 2012 - In Bowker's annual survey of US ebook publishers, Smashwords was named the largest producer of ebooks in 2012 based on ISBN count. The recognition underscores Smashwords' position as the world's largest distributor of indie ebooks.

Notable Smashwords Service Milestones for 2013

Smashwords made significant investments in 2013 to better serve the publishing and distribution needs of our authors and publishers. At Smashwords, we think of our authors and publishers as clients, not customers. It's a business relationship and we exist to serve you. Here are some notable milestones on the service side of our business.

Smashwords website redesign - Earlier this month we launched a new responsive design for the Smashwords website. The site is now more attractive and mobile-friendly than ever before. Expect more improvements to the site and publishing platform features and interfaces in 2014!

Preorder distribution - After months of testing, in July we introduced preorder distribution to Apple, Barnes & Noble and Kobo. Preorders are an incredibly powerful sales and merchandising tool. Many Smashwords authors have leveraged preorders to hit the bestseller lists.

Smashwords Interviews - In August, we launched Smashwords Interviews, a fun tool that helps readers discover the story behind the author. It's a self-interviewing tool. Already, over 4,000 interviews have been posted. They're amazing! Complete your interview today if you haven't done so already.

Publishers Weekly/Smashwords Bestseller List - In June, Publishers Weekly magazine started publishing our top 25 bestseller list each month. The list is based on aggregated sales reports from Smashwords retailers and the Smashwords store. If you're distributed by Smashwords, you've got a shot at the list!

Expanded distribution - We expanded the Smashwords distribution network to include Flipkart (#1 bookseller in India) and two subscription ebook services, Oyster and Scribd. We've signed additional distribution agreements which we'll announce in the months ahead.

Series Manager - In September, we launched Smashwords Series Manager. Series Manager collects enhanced metadata that makes it easier for readers to identify and discover books in a series. The data also sets the stage for retailers to improve the discoverability of our series books. Today, 38,211 books are attached to 10,419 series. If you haven't attached your series books with Series Manager, do it now!

Support for serials - The launch of Series Manager allowed us to modify our Terms of Service to allow serialized publications.

YouTube tutorial series - We launched a series of YouTube ebook publishing tutorials and workshops, several of which are narrated versions of recent workshops I've presented at writers conferences. There's also a helpful video on how to add navigation to your Smashwords ebook, and how to integrate your Smashwords Library with your Dropbox account. Expect more tutorials in 2014. Is there a topic you'd love see us address? Suggest it below in the comments.

Apple tickets - In December we added a feature in the Smashwords Dashboard that reports Apple's change requests. If Apple's QA team finds a problem with your book can prevent a listing, you'll find it there. The feature helps authors correct issues faster so they can get books listed quicker at the world's second largest global seller of ebooks.

What's Coming in 2014
As I mentioned in my 2014 predictions post, indie authors will face significantly increased competition from traditional publishers in the year ahead. 2014 could be the first year where ebook sales, measured in dollars, decrease. Despite that ominous possibility, unit sales will increase and the opportunities before authors remains greater than ever. Our job at Smashwords is to provide you the tools and knowledge to compete, and our development roadmap is informed by this goal.

Our development roadmap for 2014 is really exciting. If writers are the magicians behind books, then the engineers at Smashwords are the magicians behind the new enhancements - large and small - that we make at Smashwords every week. Our authors tell us what they want, I weave the ideas into initiatives and our engineers make these ideas happen. Without tipping our hand too much, in broad strokes here's a hint of what you can expect to see in 2014:

Distribution systems - We'll work to give you improved control over more aspects of your distribution. We're already shipping daily, at least fives days a week to Apple, B&N and Kobo. In 2014 we'll increase the shipment frequency further for retailers that can support it. Faster shipments mean faster time to market and greater, faster control over pricing and metadata updates.

Reporting systems - We'll overhaul our reporting systems so you have faster, more intuitive access to sales data and trending information. We improved the speed of sales reporting in 2013, and in 2014 we'll improve it even further.

New book marketing tools - We'll introduce multiple new tools that will help authors improve the discoverability and sales of their books.

Skunk works - There are some projects so secret I won't even give a hint. Some of the projects are foundational in the sense that their true potential won't be apparent until after we build additional features on top of them. Rest assured all projects we undertake will be focused on making Smashwords a more powerful publishing and distribution platform that gives our authors real advantage in the marketplace.

Thank you again for your past and future support.

We realize you have many choices for ebook publishing and distribution. When you work with Smashwords, you are directly supporting our mission to help you reach more readers. By distributing to major retailers through Smashwords, you further our ability to advocate on your behalf, and to continue investing in tools and services that will benefit the entire indie author community.

30 comments:

Thanks for all your hard work Mark and the Smashwords team. I am especially happy that you opened up to allow serialized fiction as the timing of your announcement coincided with my series release which is seeing some success through Smashwords distribution.

Well done Mark and all the team. One area needing serious work on is the communication on our behalf to the affiliates. We writers have little or no way to reach them, (unless we publish directly with them) and in my experience, communicating via smashwords leaves much to be desired. So, I hope this is on the "to do list" That said, I applaud your efforts and more power to you all. Kind regards, Gary Weston

Happy New Year to Mark and the Smashwords team and Smashwords family (authors). Mark, I truly enjoy how you communicate with us like a good father to his children. Thanks for encouraging, coaching, mentoring, providing success tools, and opening doors for us. Thanks for keeping us informed about where the book publishing industry is going and how we can stay on course to experience success in our craft. All the best to you in 2014, Christine Brooks Martin

I've been with you since 2010, now with 8 novels. When Amazon tried to squeeze you with Select, I argued against such monopolistic efforts far and wide. The relative "failure" of Select has encouraged me. Now--will you please do for audio books what you've done for ebooks? A lot to ask I know, but ACX sucks. Thanks.

I'm very happy that I finally joined Smashwords. My book went to iTunes, B &N etc so fast I couldn't believe it. Awesome! Now if only your IRS didn't make it so hard to get that ITIN # for exemption on that 30% with-holding tax, I might one day make a few pennies on my eBook sales LOL!

I have been with Smashwords since 2009 and in the past 4 years I have always been impressed with the both the vision that Mark brings to this ceiling busting business and the functional application of that vision. I know I speak on behalf of all involved in saying Thank You for all you do. Here's to a great 2014!

I'm looking forward to using Smashwords to the max in all of my new projects. I think some other retailer's so-called "improvements" have hurt the indie author. But I feel positive energy at Smashwords.

Happy New Year Mark and all the Smashwords team. I really appreciate your foresight and the opportunities you have created for myself and so many others, writers and readers. I look forward to seeing what comes next.

Thank you Mark and your team - for your vision and continued commitment to this great service you offer. You make our lives as writers immeasurably easier, more fruitful and profitable! So glad I published through you in 2013. Looking forward to 2014 and more success for all of us! Rob McShane